The Los Angeles Superior Court has approved a $1,000 daily limit on cryptocurrency ATM withdrawals. The initiative was put forward by the California Department of Financial Protection and Innovation (DFPI).

The court found the restrictions to be effective precautions that will help reduce the risks of cryptocurrency fraud and protect consumers interacting with crypto services. California authorities proposed introducing the limit last fall. However, earlier this year, the Alliance for Fair Access to Crypto ATMs filed a lawsuit, calling the restrictions excessive and beyond the scope of legislative authority.

DFPI Commissioner Clothilde Hewlett assured that despite the controversy surrounding the regulatory restrictions, the measures taken will protect users from scammers and limit the use of cryptocurrency ATMs for illegal purposes. These protective measures should not only strengthen consumer confidence in cryptocurrencies, but also promote the long-term development of the cryptocurrency ecosystem in the state.

In October 2023, California signed the Digital Financial Asset Law (DFAL). In addition to the daily withdrawal limit for crypto ATMs, DFAL also places restrictions on the fees that ATM operators can charge, and they must fully disclose this information to customers. All crypto ATM operators will be required to obtain a license by July 2025.

According to the US Federal Trade Commission (FTC), since 2020, the volume of crypto ATM fraud has increased tenfold, with user losses exceeding $110 million.